XRG Signs Agreement To Acquire Stake In Southern Gas Corridor, Strengthening Energy Ties With Azerbaijan

XRG, an international energy investment platform initiated by ADNOC in November 2024, has revealed plans to acquire a stake in Southern Gas Corridor CJSC (SGC) from Azerbaijan's Ministry of Economy. This development marks a significant step in strengthening the strategic energy partnership between the United Arab Emirates (UAE) and Azerbaijan. The agreement was signed during ADIPEC.

SGC, established in 2014, is an Azerbaijani energy holding company. It manages natural gas production assets and operates a 3,500 km pipeline network stretching from the Caspian Sea through Türkiye to southern Europe. This infrastructure can currently deliver up to 26 billion cubic metres annually. The deal could boost Azerbaijan’s economy and solidify its reputation as a dependable partner.

The Heads of Terms were signed at ADIPEC by Dr. Sultan bin Ahmed Al Jaber, Minister of Industry and Advanced Technology and Executive Chairman and CEO of XRG, alongside Mikayil Jabbarov, Azerbaijan's Minister of Economy and Chairman of SOCAR’s Supervisory Board. This agreement could broaden XRG's collaboration with SOCAR beyond gas production to ensure stable energy supplies to European markets looking for diverse sources.

XRG already holds strategic interests in the Caspian region. It has a 30 percent stake in the Absheron gas and condensate field through its partnership with SOCAR. Additionally, XRG owns a 38 percent share in Turkmenistan's offshore Block I gas concession. In May 2024, SOCAR acquired a 3 percent stake in Abu Dhabi's SARB and Umm Lulu concession from ADNOC.

Southern Gas Corridor is a Closed Joint-Stock Company owned by Azerbaijan's Ministry of Economy and SOCAR. Its assets include stakes in the Shah Deniz gas and condensate field, the South Caucasus Pipeline, the Trans Anatolian Pipeline, the Trans Adriatic Pipeline, and shares in Azerbaijan Gas Supply Company Limited.

This agreement represents another milestone for both nations' energy sectors. It highlights their commitment to enhancing economic ties while ensuring reliable energy supplies across regions seeking diversification.

With inputs from WAM